Vendor Contacts

I've never seen this before.  I'd try two things:

1) Re-sort the Names list (not the vendor list). To do this, open a check, click in the Payee field, and then press Ctrl-L to open the Names list (which is a list of all of the different types of names).  Then pick Re-sort list from the Name button at the bottom of the list.

It that doesn't fix it, then...

2) Rebuild (repair) the company file by picking Rebuild Data from the File | Utilities menu.